China Producer Prices Climb to Two-Year Highs, Spurring Global Inflation Risks

The Chinese producer price index rose to 1.7% in February to surpass expectations and mark the fastest pace in over two years, official data showed.

• Economists predicted the index to increase 1.5% last month from 0.3% in January.
• The latest data raises expectations of higher global prices as factories hike prices for exports. Chinese producer prices have already been a major contributor to global inflation.
• Bond markets already expect faster global growth and massive fiscal stimulus in the United States to push up inflation.
• Oil prices have surged to $70 a barrel, along with the rally of copper and agricultural goods, and the soar of shipping rates. The shortage of computer chips could also push up prices.
• Consumer prices fell 0.2% in February, slightly better than the projected 0.3% decline with the biggest gains recorded in mining.